T-3000-83
Airport Taxicab (Malton) Association (Plaintiff)
v.
Minister of Transport (Defendant)
Trial Division, Reed J.—Toronto, April 22;
Ottawa, April 26, 1985.
Judicial review — Equitable remedies — Injunctions —
Application enjoining defendant from instituting common dis
patch service at airport — Dismissal of motion to strike under
R. 419(1)(a) not meaning "serious question to be tried" —
Claim airport management's practices discriminatory weak —
Balance of convenience — Irreparable harm — Plaintiff's
damage arising from inability to pursue activities prohibited
by s. 7 Regulations — Damages award not adequately com
pensating defendant for injury due to pestering of public
resulting in complaints — Application dismissed — Federal
Court Rules, C.R.C., c. 663, R. 419(1)(a) — Government
Airport Concession Operations Regulations, SOR/79-373, ss.
4(1),(2),(3), 6(1),(2)(b), 7(a),(b) — Aeronautics Act, R.S.C.
1970, c. A-3.
Aeronautics — Taxicab association seeking injunction
restraining Transport Minister from instituting common dis
patch service for taxis and limousines at Pearson International
Airport — Chaos on platform due to competition for business
— Industry failing to co-operate in operating joint dispatch
system — Whether airport manager exercising discretion re
permits and platform space allocation in non-discriminatory
way — Whether taxi dispatching at airports within federal or
provincial jurisdiction — Minister's injury if travellers com
plain about pestering for business not compensable by dam
ages award — Interlocutory injunction denied — Government
Airport Concession Operations Regulations, SOR/79-373, ss.
4(1),(2),(3), 6(1),(2)(b), 7(a),(b) — Aeronautics Act, R.S.C.
1970, c. A-3.
Constitutional law — Distribution of powers — Whether
dispatching of limousines and taxis from airport integral part
of limousine and taxi operations and therefore under provin
cial jurisdiction — Federal jurisdiction to regulate not ousted
if regulation necessarily incidental to airport regulation.
This is an application by the plaintiff for an interlocutory
injunction to prevent the defendant from instituting a common
dispatch service for the taxicabs and limousines operating out
of Pearson International Airport. The taxicab and limousine
owners operated their own separate dispatch systems. They not
only accepted incoming orders but actively solicited customers
on behalf of their respective services. Following complaints by
the public as to the competing dispatchers' conduct, an agree
ment to provide a common service was reached. The situation
deteriorated, however, and the system of having two dispatch
ers reinstated.
Held, the application should be dismissed.
It is well established that in order to grant an interlocutory
injunction (1) the court must be satisfied that there is a serious
question to be tried and (2) the balance of convenience must
weigh in the applicant's favour.
The dismissal by Muldoon J. of a motion brought under Rule
419(1)(a) to strike out the statement of claim as disclosing no
reasonable cause of action did not automatically give rise to
there being a "serious question to be tried". The plaintiff
argues that the airport manager's discretion as to the allocation
of platform space and the issuing of permits to vehicle opera
tors must be exercised in a non-discriminatory manner. Never
theless, as pointed out by Muldoon J., "by virtue of the
provisions of the Aeronautics Act ... the defendant is thor
oughly 'in charge' of airports". The airport manager's absolute
discretion is also evidenced by the Government Airport Conces
sion Operations Regulations. Thus, while the plaintiffs claim
is not one to be struck out under Rule 419(1)(a), it does not
appear strong.
The plaintiffs second argument is that the dispatching of
limousines and taxicabs forms an integral part of the limousine
and taxicab operations and that these are matters under exclu
sive provincial jurisdiction. A finding that "dispatching" is an
integral part of the taxicab business would not oust federal
jurisdiction to regulate that activity if such regulation were
necessarily incidental to the regulation of the airport. In any
event, the Court did not make any finding as to whether the
plaintiff had met the test of a serious question to be tried.
With respect to the balance of convenience and the consider
ations of irreparable harm, the plaintiffs loss of profits could
be adequately compensated by an award of damages. Although
the calculation and eventual allocation of any reimbursement of
the profits could be difficult given the number of taxicab
operators and the loose form of organization, that would not be
impossible.
The crucial factor is that the damage that the plaintiff will
suffer will arise from it not being able to engage in activities
expressly prohibited by section 7 of the Regulations. That
section prohibits persons from soliciting business at airports
except with the authorization of the Minister.
It was clear that the defendant would suffer damage in
having to tolerate pestering of the public by dispatchers and
consequent complaints to the airport management. This is not
an injury which can be compensated by an award of damages.
The defendant is responsible for the orderly administration of
the airport and its ability to fulfil that responsibility would be
diminished if an injunction is granted.
CASES JUDICIALLY CONSIDERED
DISTINGUISHED:
Fraser v. U-Need-A Cab Ltd.; Great American Insur
ance Co., Third Party (1983), 43 O.R. (2d) 389 (Ont.
H.C.).
CONSIDERED:
American Cyanamid Co. v. Ethicon Ltd., [1975] A.C.
396 (H.L.).
REFERRED TO:
Johannesson v. West St. Paul, [1952] 1 S.C.R. 292.
COUNSEL:
Charles C. Roach for plaintiff.
Alan S. Davis and Peter A. Vita for
defendant.
SOLICITORS:
Roach-Smith, Toronto, for plaintiff.
Deputy Attorney General of Canada for
defendant.
The following are the reasons for order ren
dered in English by
REED J.: This is an application by the plaintiff
for an interlocutory injunction to prevent the
defendant from instituting a common dispatch ser
vice for the taxicabs and limousines operating out
of Pearson International Airport. In addition, it
seeks to prevent the defendant from inviting ten
ders from persons, independent of both the taxicab
and limousine owners, to provide that service.
In December 1983, the plaintiff commenced an
action for a declaration that the defendant (1) had
no lawful right to tender out the dispatch service;
(2) that the defendant's present practice of main
taining separate queues for the taxicab and limou
sine services at the airport was discriminatory; and
(3) for an interlocutory injunction to prevent the
tendering out of the dispatch service until final
disposition of the issues at trial. Although the
declaration of December 1983 set out a request for
an interlocutory injunction no action was taken by
the plaintiff to obtain such injunction prior to the
present time (April 1985). This was not, however,
delay sufficient to bar the plaintiff from now
pursuing its claim for an interlocutory injunction.
The delay was explained as having occurred
because the defendant had not before now taken
action to implement its intention with respect to
the tendering process and independent dispatch
service.
The situation of December 1983 must be put in
perspective. From 1979 to February 1982 the taxi
cab and limousine owners operated their own sepa
rate dispatch systems. While these are called dis
patch systems the dispatchers in fact did more
than is usually contemplated by that term. They
did more than merely accept incoming orders for
their respective services and allocate such requests
among the available taxicab or limousine drivers.
The "dispatchers" actively solicited customers for
their respective services presumably from those
members of the travelling public who sought
ground transportation but were uncommitted as to
the type of service they sought and, perhaps even
from others.
The dispatchers were located at the exits of the
airport terminal, at curbside in the vicinity of the
respective vehicle queues. I quote from the cross-
examination of Mr. Mann whose affidavit was
filed in support of the plaintiff's claim in this case:
A. The problems were that the limousine dispatchers trying to
grab as many people as possible for the limousines, and the taxi
dispatchers were trying to grab as many people as possible for
the taxis.
Q. Okay, so would you agree with me that a bit of chaos was
taking place on the platform?
A. That's right.
Q. Well, were there in fact occasions where both dispatchers
were fighting over the same customers?
A. It happened, yes.
Consequently, in March 1982, the airport manager
wrote to all taxicab and limousine operators:
Transport Canada has. during the past year, experienced an
increasing number of complaints from the travelling public
regarding the conduct of platform dispatchers. The fights and
arguments between competing dispatchers and, periodically,
drivers plus the hassle accorded the travelling public is no
longer tolerable.
The letter went on to advise the industry that they
had one final chance to co-operate and create a
joint dispatch system or Transport Canada would
implement one of its own. This led in February
1983 to an agreement on a common service to be
run by the taxicab and limousine operators jointly.
One of the terms of that agreement was that the
dispatch supervisor was:
1. To ensure that Dispatchers provide passengers direction to
the mode of transportation requested and that there is no
favouritism shown for either taxicabs or limousines.
The dispatchers themselves had an obligation to:
... provide impartial information between taxis and limousines
when requested by a passenger.
and not to:
... yell or shout, nor hawk ground transportation services while
on duty.
Despite this agreement to provide a common
service the situation again deteriorated. I quote
again from the cross-examination of Mr. Mann:
Q. All right, what did in fact happen?
A. It was happening because it depends who can really have
more friendship with the dispatchers, and they can provide him
with more business.
Q. Okay, what you're saying to me is that dispatchers, although
independent, were being influenced by either limousine or taxi
drivers?
A. That's right, yes.
Q. And so in fact they were actively steering people to—
depending on who was out on the platform—to either the taxi
or the limousine?
A. That's right, yes.
Q. All right, what did that do? Did that then cause disruption
on the platform?
A. Yes it did, many times.
It was in the light of this deterioration that the
airport manager notified the industry in October
1983 that an independent dispatch service would
be instituted and tenders called for the provision of
that service. This expression of intention gave rise
to the plaintiff commencing action in December
1983, for the remedies sought in this suit. The
defendant did not, however, move to implement its
intention to establish an independent dispatch ser
vice immediately. Discussion with the industry
continued. Then, in May 1984 the limousine oper
ators pulled out of the joint dispatch service and
reinstituted their own service. Thus, since May
1984, the pre-February 1983 system of two dis
patchers (one employed by the taxicab operators
the other by the limousine operators) has pre
vailed. The defendant recently reactivated its plan
to set up an independent dispatch service and the
defendant filed this motion for an interlocutory
injunction.
The requirements that an applicant must meet
in order to obtain an interlocutory injunction are
well known: (1) the court must be satisfied that
there is a serious question to be tried; (2) the
balance of convenience must weigh in the appli
cant's favour. The decision in American Cyanamid
Co. v. Ethicon Ltd., [1975] A.C. 396 (H.L.) has
been accepted as setting forth the appropriate
tests.
With respect to the first requirement, the plain
tiff argues that a decision given by my colleague
Muldoon J. in June 1984 [T-3000-83, Federal
Court, Trial Division, June 18, 1984, not yet
reported], in an earlier interlocutory proceeding
between the parties demonstrates that that
requirement has been met. Mr. Justice Muldoon's
decision was in response to a motion brought by
the defendant seeking to strike out the plaintiff's
statement of claim under Rule 419(1)(a) as dis
closing no reasonable cause of action. That motion
was dismissed by Mr. Justice Muldoon.
I do not think that merely because a plaintiff
has successfully resisted a defendant's motion to
strike pursuant to Rule 419(1)(a) that it can
automatically be assumed that there exists "a
serious question to be tried" for purposes of
obtaining an interlocutory injunction. In the first
place a Rule 419(1)(a) motion must be heard in
the absence of any evidence. Secondly, everything
set out in the declaration (statement of claim)
must be assumed to be true. Thirdly, the strength
of case required to be proved by the plaintiff is not
high—it is minimal at best. Fourthly, the burden
of proof is on the party bringing the motion not the
party resisting it.
While the plaintiff's claim is not one to be
struck out under Rule 419(1)(a), it is not strong.
One ground of the plaintiffs claim is that the
airport manager's present practice of providing
two queues, one for limousines and one for taxi
cabs is discriminatory since both vehicles provide
the same service to the public. The plaintiff also
asserts that the practice of alloting equal platform
space to the two queues is discriminatory because
there are 300 taxicab permit holders but only 200
limousine permit holders.
The plaintiff concedes that the airport manager
had discretion both as to the allocation of platform
space and the issuing of permits to vehicle opera
tors; but, it argues that that discretion must be
exercised in a non-discriminatory way. Neverthe
less, as Muldoon J. pointed out at page 4 of his
decision of June 18, 1984:
... by virtue of the provisions of the Aeronautics Act (R.S.C.
1970, c. A-3) the defendant is thoroughly "in charge" of
airports, aerodromes, airport services and, indeed, virtually
every commercial activity which is conducted within the territo
rial boundaries of an airport. The Act provides:
3. It is the duty of the Minister
(a) to supervise all matters connected with aeronautics;
(c) to construct and maintain all government aerodromes
and air stations ...
(e) to operate such services as the Governor in Council
may approve;
(m) to perform such other duties as the Governor in
Council may from time to time impose.
5. The Governor in Council may make regulations, or,
subject to and in accordance with such terms and conditions
as may be specified by him, authorize the Minister to make
regulations prescribing charges for the use of
(b) any facility or service ... provided by the Minister or
on his behalf at any airport.
By virtue of the Ministerial Regulations Authorization
Order (C.R.C., c. 126) the immediately above-cited statutory
provisions are invoked to accord to the Minister the authoriza
tion which may lawfully be accorded thereunder.
The Government Airport Concession Operations
Regulations, SOR/79-373, 27 April, 1979 provide:
7. Subject to section 8, except as authorized in writing by the
Minister, no person shall
(a) conduct any business or undertaking, commercial or
otherwise, at an airport;
(b) advertise or solicit at an airport on his own behalf or on
behalf of any person; or
6. (1) An airport manager may, by means of a sign or
surface marking, describe or delineate any area at the airport
as an open taxicab station, open limousine station or general
vehicle station.
(2) Where an area has been described or delineated pursuant
to subsection (1)
(b) as an open taxicab station or open limousine station, an
operator of a taxicab or limousine shall not pick up or unload
a passenger or goods at that airport except at that open
taxicab station or open limousine station, as the case may be.
4. (1) The Minister may designate any airport at which a
permit is required to operate a commercial passenger vehicle or
a courtesy vehicle.
(2) Where the Minister designates an airport pursuant to
subsection (1), he may specify the class or classes of commer
cial passenger vehicles or courtesy vehicles that require the
operator of those vehicles to be issued a permit before operating
those vehicles at that airport.
(3) A designation referred to in subsection (1) or a specifica
tion referred to in subsection (2) may be revoked by the
Minister.
The plaintiff's second basis for its claim is that
the defendant is constitutionally incompetent to
regulate the dispatching of limousines and taxicabs
from the airport because such activity is an inte
gral part of the limousine and taxicab operations;
it is alleged these are matters under exclusive
provincial jurisdiction. While it is true that the
decision of the Ontario High Court in Fraser v.
U-Need-A Cab Ltd.; Great American Insurance
Co., Third Party (1983), 43 O.R. (2d) 389 implic
itly carries with it a finding that dispatchers (in
that case called "taxi-brokers") are an integral
part of the taxi business several additional factors
must be noted. That case dealt with the liability in
tort of a "taxi-broker" for damage caused to a
passenger by a defective taxicab; it did not deal
with the constitutional issue. The "dispatchers" at
the Pearson International Airport are performing
a vastly different function from the dispatchers
(taxi-brokers) in the Fraser case. (Would the "dis-
patchers" at the airport be liable in tort for
damage caused to a passenger as a result of a
defective airport taxi?) A finding that "dispatch-
ing" is an integral part of the taxicab business still
would not oust federal jurisdiction to regulate that
activity if such regulation were necessarily inciden
tal to the regulation of the airport. See the discus
sion of Johannesson v. West St. Paul, [1952] 1
S.C.R. 292 and related cases, in Hogg, Constitu
tional Law of Canada (1977) at page 335.
In any event, without making any finding as to
whether I think the plaintiff has met the test of "a
serious question to be tried", I will pass to a
discussion of the second requirement: whether the
balance of convenience and considerations of
irreparable harm argue in favour of the granting
of the injunction to the plaintiff. This requirement
is described in the American Cyanamid case,
(supra) at page 406:
The object of the interlocutory injunction is to protect the
plaintiff against injury by violation of his right for which he
could not be adequately compensated in damages recoverable
in the action if the uncertainty were resolved in his favour at
the trial; but the plaintiffs need for such protection must be
weighed against the corresponding need of the defendant to be
protected against injury resulting from his having been prevent
ed from exercising his own legal rights for which he could not
be adequately compensated under the plaintiffs undertaking in
damages if the uncertainty were resolved in the defendant's
favour at the trial. The court must weigh one need against
another and determine where "the balance of convenience" lies.
In this case what is the harm the plaintiff
alleges it will suffer? As I understand it, it is the
loss of business which will occur as a result of
dispatchers employed by it not being able to solicit
customers. It is a loss of profits claim and as such
one that is usually seen as adequately compensated
by a monetary award in damages. In this case the
calculation of, and eventual allocation of any reim
bursement of that profit might be difficult given
the numbers of taxicab operators involved and the
loose form of organization. However, it would not
be impossible. In addition, the crucial factor in this
case is the fact that from the evidence set out
above, it is clear that the damage which the plain
tiff will suffer will arise from it not being able to
engage in activities, or encourage others to engage
in activities which it has no right to do. By section
7 of the Government Airport Concession Opera
tions Regulations (supra, page 399) persons are
prohibited from soliciting business at the airport
except with the authorization of the Minister. It is
clear that the Minister has given the curbside
"dispatchers" no such authorization and indeed
the airport manager has been trying to stop this
unauthorized activity. I would underline that it is
not merely the members of the plaintiff association
that have been engaging in such activity; the
limousine operators have equally been engaging in
this prohibited conduct.
What then is the harm that the defendant will
suffer if the injunction is granted? Counsel
indicated that there might be monetary loss as a
result of actions already taken by it to implement
the independent dispatch service (e.g.: as a result
of contracts which have already been signed?) I do
not find any evidence on the file attesting to this
fact. However, it is clear that the defendant will
suffer damage in the sense of having to tolerate
"chaos on the platform" as it was put in the
cross-examination of Mr. Mann. The damage
which will occur will be the hassling of the travel
ling public and consequent complaints by members
thereof to the airport management. The defendant
is responsible for the orderly administration of the
airport. Its ability to fulfil that responsibility will
be diminished if an injunction is granted. It is
clear, this is not an injury which can be compen
sated by a monetary award in damages.
For the reasons which appear above, I do not
think the plaintiff has demonstrated that the bal
ance of convenience lies in its favour. Accordingly,
the application for an interlocutory injunction will
be dismissed.
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